California Utility to Buy 500 Megawatts of Solar Thermal Power

August 16, 2006

Pacific Gas and Electric Company (PG&E) announced on August 10th its contract with Luz II, LLC to purchase at least 500 megawatts (MW) of solar energy starting in 2010. The original Luz firm was a pioneer of solar energy development, building nine solar electric generating systems in southern California between 1984 and 1990. Those solar plants continue to generate power by using trough-shaped mirrors to focus the sun's energy onto a tube through which a fluid is pumped. Luz II is led by the original management team for Luz, but employs a propriety new hybrid design that runs off both solar energy and natural gas. Luz II claims that the new technology is more efficient than Luz's solar troughs and is significantly less expensive to build and operate. PG&E provides electricity and natural gas to 15 million people in north and central California, from Eureka in the north to Bakersfield in the south. See the PG&E press release.

If the PG&E news sounds familiar, that may be because the utility is following the lead of its southern California neighbors. Last year, both Southern California Edison (SCE) and the San Diego Gas and Electric Company (SDG&E) announced similar contracts to buy large amounts (500 MW and 300 MW, respectively) of solar thermal power from Stirling Energy Systems, which uses Stirling solar dish technology. Earlier this year, construction began on a 64-MW solar trough system in Nevada and a 1-MW solar trough system was completed in Arizona. See the stories from previous issues of this newsletter on the SCE and SDG&E contracts and the systems in Nevada and Arizona.